Co-Production and Managed Competition in Mixed Quasi-markets

摘要

In this paper, we provide a very simple model to shed light on theudissue of managed competition in mixed quasi-markets (i.e. regulated marketsudin which social and for-proÖt Örms coexist). In doing this, we consider theudliterature on mixed oligopolies as a reasonable reference point and try to enrich itudwith the idea of quasi-market. Firstly, our results show that social Örms serve theudrelatively richer portion of the population. Only relatively poor consumers buyudunits of service from the proÖt-oriented Örm. Secondly, the socially-preferableudform of managed competition is to introduce coproduction practices and, hence,udto raise proÖt-oriented Örmís production costs. The diffusion of coproduction paradigms ensures maximal service quality and eliminates mark-up from the market.